Nightmares of Joint Ownership

Nightmares of Joint OwnershipI cannot begin to fathom how many times I have discussed the issues surrounding jointly held property (both real and investment/bank account properties) with clients who are not husband and wife.  In reality, it seems as though people add family members and other trusted loved ones as joint account owners on a regular basis.  The overwhelming reason?  To “keep things easy”; that way, if something happens to me, my joint account holder can take care of me and my bills.  The second reason?  To avoid “dealing with the courts” when my loved one dies.

Unfortunately, this strategy can prove to be a nightmare in reality.  What most people do not realize is that by adding another person to their account as a joint account owner, that persona actually becomes an “owner” of the account.  Should they choose, that person could remove all of the money from your account without your approval or knowing until it is too late.  Perhaps that argument alone isn’t sufficient to change your mind.  So, consider instead that your joint account owner executes a General Power of Attorney and appoints someone to handle their legal and financial matters for them.  There is little chance you will even know about the existence of this document, let alone who is appointed.  However, the person appointed could just as easily, in your joint account holder’s stead, wipe out your bank/investment account on their own, without you and/or your joint account holder being aware until it is also too late.

Still not convinced?  Consider the possibility that your joint account holder comes upon misfortune and has creditors looming over him/her.  These creditors could come in the form of financial creditors due to unpaid bills, accidents in which your joint account holder is found liable, as well as soon-to-be ex-spouses.  Considering 1 in 2 American marriages ends in divorce, even happy marriages can dissolve.  If your joint account holder is going through a divorce, your assets will be pulled into their division of marital assets (due to their joint ownership of your account).

Is expediency really a reason to bring all of these harsh realities upon you and your financial well-being?  Of course not!  There are legal solutions to all of your concerns that alleviate the issues which may have you concerned while also protecting you and your financial/legal future.  Consider checking out these links to learn more about some of the legal opportunities that can accomplish all your goals while safeguarding you and your future:

General Durable Power of Attorney

Revocable Living Trust

Asset Protection Trust

Long Term Care Planning

If, after reviewing this information, you are reconsidering decisions you may have made in the past, please take the time to consult with an experienced estate planning attorney regarding how you may best be able to achieve your goals while also protecting yourself.

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